Tag Archives: Marketing

Tracking in 2014- five things to measure

stephen2By Stephen Rhodes

My last blog talked about hitting the refresh button at the start of 2014, shaking off the bad or embracing the good as the giant ball dropped at Times Square.

I mentioned the importance of hitting the ground running in 2014 and today had the opportunity to listen to a group of networkers  talk about just that and for some the first few weeks were already promising. As the first meeting of the year, for this networking group, many reported success in 2013 over the previous year. How did they know. They track their business.

Now for some of you that’s a no brainer.

MeaSURINGHere are five things every business should measure

  1. The sales pipeline – I think we all understand the importance of filling the hopper/pipeline with prospects to help take the peaks and valleys out of the business cycle. When we are busy it is difficult to remember that new leads may take months to emerge as business, but it is vital that we keep looking for new customers even during peak periods. Every business is different in terms of the length of time required to turn a lead into a sale, so first understand your own cycle. Equally important, is to track the leads so you know where to put the effort/money to build the business. Ask people how they heard about you. And track what activity – advertising, website, social media, newsletter, networking – generated the business.
  1. Conversion rate – So we are really good at generating leads but not so much at converting those leads into sales. How many leads do you need to generate the business you require to meet your revenue targets. If you need 10 new customers a month (average sale $2,000 a month) to meet your target and your conversion rate is 25% then you must generate 40 new leads a month. Understanding this dynamic helps you to manage the business throughout the year and make adjustments as required.
  1.  Cost of New Business – Tracking leads and where they came from tells you what activity is generating new business  but it’s also important to know at what cost.  Using our example in #2, we know that we need 10 new customers or $20,000 each month to meet our targets, But what did it cost to get that $20,000 in new revenue? You paid to generate 40 leads, remember. Knowing the cost, and what activity generated the revenue, is fundamental in managing your business.
  1.  Customer satisfaction – It’s more expensive to generate a new customer than it is to keep an existing one. If you are growing your business 10% a year but losing the same amount, you need to know why. I have talked at length about how important it is to talk to your customers. Develop an advisory board to help you provide an excellent service level. Survey your customers. Seek out testimonials from satisfied customers. Happy customers can provide excellent referrals.

Track the details. What is the customer spend? What happens year on year? Can you raise the spend with incentives?

  1.  Profit & Cash Flow- Profit is what drives the bus, but cash flow fills the tank. Expectations around profit are different for every business, but understanding what impacts profit helps you to better determine what adjustments might have to be made to expenses or revenue. That analysis needs to take place monthly -don’t wait until November to determine that the wheels fell off along the way.

Cash flow – You need cash flow to run a business.  It doesn’t matter how much money is coming in down the road if you don’t have enough money to get from here to there. It’s the difference between what comes in and what goes out.

      Take a look at your own cash flow

  1. Start with the amount of cash on hand – your current bank account balance(s)
  2. Make a list of what’s coming in – customer payments, collection on bad debts, interest or investment earnings, etc. Include when it will be coming in.
  3. Make a similar list of money going out – payroll, monthly overhead, accounts payable or other debt, taxes payable, equipment purchases, marketing expenses, etc.

Now, track what actually happens. Set up an Excel spreadsheet with your projections and the       actual numbers. (You can also find worksheets online) It will help you see what needs to be adjusted.

There are many metrics in business, and each business may have its own measuring tools. The point here is make sure you measure results. It can be the difference between success and failure.

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Filed under Marketing, Small Business, Stephen Rhodes

Word of mouth requires word of mouth

stephen2By Stephen Rhodes

About a year ago I watched my 15-year-old grand-daughter text her girlfriend, who was sitting opposite on the couch. My wife thought it was a secret conversation that perhaps they didn’t want to share. But since then, some of my friends have shared similar experiences with today’s youth and I am concerned that they will lose the skill that will best elevate their careers, promote their businesses, advance their cause. Word of mouth.

Text MessagingWord of mouth is the cash cow of marketing. Yet, we seem to go to great lengths to avoid our customers. Are we afraid of what they might say? Do we lack confidence in our product or service offering?

Strange, perhaps, that social media is forcing us to acknowledge that being social is good for business. The tools are there to help build on that social interaction not create a barrier between you and your customer. And for businesses that get it, tools like Twitter and LinkedIn, Facebook and Pinterest provide a foundation on which to build a strong business relationship that ultimately means face time and that’s where business begins.

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Filed under advertising, Communications, Facebook, LinkedIn, Marketing, Pinterest, social media, Social Networking, Stephen Rhodes, twitter

Lost in the new world of advertising

By Stephen Rhodes

More and more, I hear clients talk about being lost when it comes to the latest trends in marketing, meaning, of course, social media.

It reminds me of the mid 90s when many small businesses migrated to the Internet because…well because they thought they had to be hip. Many jumped on board without much consideration for why they were among the newly converted or how it would help their business. “We gotta be there,” was the mantra in many boardrooms. Some are still trying to figure it out.

The same thing is happening today with social media. Businesses are setting up Facebook pages, Twitter accounts, LinkedIn, Flickr and even YouTube accounts without so much as a …how will this help our business grow?  “We gotta be there” is still the clarion call.

Advertising hasn’t changed much in 100 years. It’s still about  attracting attention, engaging minds, triggering  emotions, and changing the way people think. If you can do that you will generate sales.

What has changed is the delivery methodology.

If you want to influence behavior there is a spectrum of tools including direct mail, newspaper and magazine ads, commercial websites, radio and TV, and, of course, social media – the new darling of marketing.

The key is knowing which tool(s) works best for you. And not all tools will be effective for your business. I have a client who can track new sales every time we deliver a direct mail piece to a group of targeted clients. The key word here is targeted, often lost among the “I gotta be hip” crowd. But the point is, direct mail works for him, and he can see (measure) the return on his investment.

First and foremost is understanding your customers. Who are they and how can you reach them is the pivotal question. What do you have that they want. (the what’s in it for me question) Can I build an ongoing relationship and how can I capitalize on that to build an even bigger customer base.

These are questions you should ask every day.

Don’t get me wrong. Social Media is the future of marketing and communications. Building your own group of followers, a community of customers, all engaged and part of your business is a powerful opportunity to communicate a targeted message.

But take a measured approach. Who is your customer, what message do you want to deliver and what is the best way to get it there? Some things never change.

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Check your marketing pulse

By Stephen Rhodes

Sometimes we think that doing what we always do will yield better results. Often, doing what we always do yields the same results and if you are not happy with those results you need to change things.

Here are five things to think about as you enter a new calendar year.

1. Review your past year for what did and didn’t work.

It’s simple, if you measure the return on your marketing program. Have a look at what worked and what didn’t. Common sense should tell us to stick with the things that are working, and try new things in place of those that are not. Don’t beat a dead horse.

2. Develop a program to measure success. Survey, measure results, ask your customers.

Ok, so you couldn’t complete the first assignment above because you don’t measure the success of your marketing program.  It doesn’t have to be complicated, but you need to understand what is working and what isn’t, so track sales related to a specific campaign and compare those results to the cost of running the campaign. If it costs more to run the campaign than …I think you get the idea.

3. Look at new ways to create a dialogue with your customers. Twitter perhaps.

Some business owners are afraid to talk to their customers and that’s why social networking tools like Twitter are unattractive. Developing an ongoing dialogue with your customers can help you retool the business on the fly, responding specifically to needs identified by your customer. Try it, it’s addictive. Talking to your customers is a good thing.

4. Find bloggers in your industry and subscribe to their musings for new ideas.

You are not alone in your sphere of influence. There are experts everywhere online and you can subscribe to any number of blogs that could be useful to your business. Go to Google blog search (http://blogsearch.google.com/ ) and search for your areas of interest. You can subscribe through a reader or simply have the material delivered to your email inbox.

5. Set out a measurable plan for the year and check the pulse monthly.

Don’t wait until December to find out that your business is under-performing. Set out a plan and check monthly to ensure you are on target.  If you have three months of under-performance, you need to make a change. Better you do this in March than November. Be nimble, monitor your business and adjust accordingly.

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The Marketing Pad lives online

The Marketing PAD is a full service marketing and communications company anchored in the Toronto area. We will be using this blog to share marketing information, tips and stories to interested parties.

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